India’s defence manufacturing sector has reached a historic milestone, with Prime Minister Narendra Modi announcing that defence production has crossed Rs 1.25 lakh crore for the first time. This marks a major leap in India’s ambitions towards self-reliance in defence, with indigenous equipment now dominating procurement lists for the armed forces.
PM Modi’s announcement and vision
Addressing a gathering of defence manufacturers, scientists, and armed forces officials, PM Modi stated:
“This is a moment of pride for every Indian. The crossing of Rs 1.25 lakh crore in defence production is a testament to our unwavering focus on Atmanirbharta (self-reliance) in defence.”
He further added that India is now not only meeting its domestic requirements but also becoming a net exporter of defence equipment to dozens of countries worldwide.
Breakdown of India’s defence production growth
| Financial Year | Defence Production (in Rs Crore) |
|---|---|
| 2019-20 | 79,071 |
| 2020-21 | 84,643 |
| 2021-22 | 94,846 |
| 2022-23 | 1,07,684 |
| 2023-24 | 1,25,000+ |
Note: The production value includes output from Defence Public Sector Undertakings (DPSUs), Ordnance Factory Board (OFB), private sector firms, and MSMEs.
Key contributors to this production boom
- Major DPSUs such as Hindustan Aeronautics Limited (HAL), Bharat Electronics Limited (BEL), Bharat Dynamics Limited (BDL), and Mazagon Dock Shipbuilders Limited have contributed significantly to this growth.
- Private sector engagement has increased manifold with companies like Tata Advanced Systems, Larsen & Toubro, and Bharat Forge leading in indigenous production of critical systems.
- MSMEs’ participation has risen, with over 12,000 small and medium enterprises integrated into the defence supply chain, supplying components, sub-systems, and specialised technologies.
- Strategic projects like Tejas fighter jets, Light Combat Helicopter ‘Prachand’, K-9 Vajra-T howitzers, and multiple indigenous missile systems under DRDO have driven the value growth.
Defence exports rising alongside production
India’s defence exports have also recorded unprecedented growth, reaching over Rs 21,000 crore in FY 2023-24, compared to under Rs 2,000 crore a decade ago.
Top export items include:
- BrahMos missiles
- Dornier aircraft
- Akash missile systems
- Offshore patrol vessels
- Armoured protection vehicles
Countries in Southeast Asia, West Asia, Africa, and Latin America are emerging as primary buyers of Indian defence equipment, reflecting the country’s rising credibility in global markets.
Policy measures driving defence manufacturing growth
PM Modi highlighted the following government initiatives that have facilitated this record-breaking production:
| Policy Initiative | Impact |
|---|---|
| Defence Production and Export Promotion Policy (DPEPP) 2020 | Set clear targets to achieve Rs 1.75 lakh crore production and Rs 35,000 crore exports by 2025. |
| Positive Indigenisation Lists | Banned import of over 500 weapon systems and sub-systems to boost domestic procurement. |
| FDI liberalisation in defence manufacturing | Increased FDI under automatic route to 74%, encouraging foreign OEMs to manufacture in India. |
| Make in India initiatives | Promoted indigenous R&D, startups, and MSME participation in defence projects. |
| Defence corridors in UP and Tamil Nadu | Facilitated dedicated ecosystems with industrial clusters and testing facilities. |
Recent landmark indigenous defence projects
- Tejas Mk1A production contract awarded to HAL worth Rs 48,000 crore for 83 fighter jets.
- INS Vikrant, India’s first indigenously built aircraft carrier, commissioned into service.
- DRDO’s Medium Range Surface to Air Missile (MRSAM) systems inducted by Army and Air Force.
- Indigenous Light Combat Helicopter (LCH) Prachand deployed in border regions.
- Advanced Towed Artillery Gun System (ATAGS) developed with private sector collaboration, undergoing final trials for induction.
Experts highlight global relevance
Defence analysts believe India is steadily positioning itself as a regional security provider, with self-reliant manufacturing:
- Reducing import dependence and forex outflow
- Generating employment and skilling for lakhs of youth
- Strengthening strategic autonomy amid geopolitical uncertainties
- Enhancing India’s bargaining power in global defence partnerships
Challenges ahead
Despite the impressive growth, defence industry leaders underline that:
- Technology gaps in critical areas like jet engines, advanced radar systems, and stealth technologies remain.
- Supply chain disruptions and semiconductor shortages continue to impact timelines.
- R&D expenditure remains below 1% of GDP, requiring major scaling up to match global defence innovators.
Future roadmap
The Ministry of Defence aims to:
- Cross Rs 1.75 lakh crore in defence production by 2025.
- Achieve Rs 35,000 crore in annual exports within the same timeframe.
- Increase private sector participation to equal that of DPSUs in high-value projects.
- Accelerate indigenous development of fighter jet engines, UAVs, AI-enabled surveillance, and underwater systems.
PM Modi’s closing remarks
Reiterating his government’s commitment, PM Modi said:
“India will not only fulfil its own defence needs but will also become a reliable supplier of peace, stability, and security to friendly nations worldwide. Our youth, our scientists, and our industry will be the backbone of this journey.”
Disclaimer
This article is based on official statements, government data, and defence sector reports available till July 2025. Readers are advised to refer to Ministry of Defence notifications and accredited defence journals for deeper technical insights. The publication bears no responsibility for any decisions taken based on this news content.
